UK public debt reaches two trillion pounds for first time ever

Public sector debt in Britain has breached £2 trillion for the first time as Government borrowing hit £26.7 billion in July.

The Office for National Statistics (ONS), who published the figures on Friday, said borrowing for July was £28.3 billion more than the same period last year, and the fourth highest since records began in 1993.

Debt reached £2.004 trillion for the first time, and is up around £227.6 billion from a year ago.

By the end of July, debt was 100.5 per cent of gross domestic product (GDP) for the first time since March 1961, said the ONS.

The coronavirus pandemic had “an unprecedented impact” on borrowing, as the government throws billions at the economy in a bid to keep it afloat as lockdown devastated some industries.

Responding to the new figures, chancellor Rishi Sunak said: “This crisis has put the public finances under significant strain as we have seen a hit to our economy and taken action to support millions of jobs, businesses and livelihoods.

“Without that support things would have been far worse.

“Today’s figures are a stark reminder that we must return our public finances to a sustainable footing over time, which will require taking difficult decisions.”

He added the government was taking action to support businesses through its Plan For Jobs scheme, which is “protecting, supporting and creating jobs to ensure that nobody is left without hope”.

A report published by the Office for Budget Responsibility suggests that borrowing in the current financial year, between April 2020 to March 2021, could increase to £322 billion, around six times the amount borrowed in the financial year ending March 2020.